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A state Supreme Court ethics ruling published this week says that a law firm need not and in fact cannot advise a corporate client that an employee has contacted the firm seeking representation in a suit against the company. Opinion 695 of the Advisory Committee on Professional Ethics [published this week at page 73] is the first interpretation of newly adopted Rule of Professional Conduct 1.18, which prohibits “use or revelation of information from a prospective client,” wrote the committee. The rule took effect on Jan. 1. People seeking representation have a reasonable expectation that what they say to a lawyer will not be disclosed or used against them if the lawyer does not take the case, wrote the committee. Lack of confidentiality would create a chilling effect that would be “crippling and an unacceptable hindrance to the public’s ability to gain access to attorneys,” the committee continued. Those considerations are “especially compelling” in the context of limited legal assistance to low-income people by nonprofit groups, such as hotlines, noted the committee, whose chairman, Melville Miller Jr., is the executive director of Legal Services of New Jersey. Opinion 695 also says the duty of confidentiality does not prevent the firm from continuing to represent the corporate client after contact by the employee. But the firm must shield the employee’s information from firm personnel doing work for the employer. Though RPC 1.18(b) prohibits representing a client adverse to a former prospective client, the employee here is a new prospective client, reasoned the committee. But management-side employment lawyers who reviewed Opinion 695 last week say it will cause complications. “The committee bought itself more business,” says Richard West Jr., who anticipates he will need to ask for guidance in situations that might pose conflicting obligations. For example, lawyers for publicly traded entities that must disclose potential liabilities might be placed in the difficult position of knowing disclosure is inadequate but being unable to tell their client, says West, of Lum, Danzis, Drasco & Positan in Roseland. Moreover, if an employee or former employee of a client calls about a possible suit, the lawyer can cut off the discussion, but that does not work with unsolicited voice mail messages, where callers say “things we would never allow them to say in person,” says West. The same goes for e-mail. Knowing the client faces a suit but not being allowed to divulge that “puts a wedge” in the attorney-client relationship and can make things awkward if the company learns the lawyer held back the knowledge, he says. Patrick Stanton, another management lawyer, says the opinion’s screening requirement is out of touch with “the real world” and will force his firm to implement a new process for handling calls from would-be clients. “From now on, any individual who tries to call me who is not an existing client will not be able to talk with me because I can not take the chance that they happen to be someone who may bring an action against one of my corporate clients,” says Stanton, a partner with the Morristown office of Ogletree, Deakins, Nash, Smoak & Stewart. The rule can also be manipulated, allowing someone who knows of a lawyer’s relationship with an employer to knock him out of a case with just one phone call. “It’s a real easy way for me to be bumped out of defending a client I might have represented for 15 or 20 years,” says Stanton, who is also chairman of the Labor and Employment Law Section of the New Jersey State Bar Association. Stanton calls Opinion 695 “a step backward” for access to lawyers because he and others will no longer be able to refer callers to counsel who can help them. Lisa Manshel, who represents employees, sees a silver lining for management lawyers. If they have discretion to tell a client about an employee planning to sue them or are required to do so, they could wind up as defendants if the employee later claims retaliation, says Manshel, of Millburn’s Francis & Manshel. Opinion 695 is “in some ways a gift to the defense bar.” Stanton and West differ on what it takes to trigger the screening requirement. Stanton’s view is any contact with an employee wanting to sue will suffice, while West reads Opinion 695 more narrowly, as requiring communication about the substance or strategy of the suit. Howard Erichson, an ethics professor at Seton Hall University School of Law, sides with Stanton. “When a prospective client meets with a lawyer and says ‘I have a problem,’ that’s confidential information,” he says. Maintaining that confidentiality breaches no duty to the existing client “because you’re not doing anything to make the client worse off.” The potential that the rule might be abused to disqualify a lawyer does not mean RPC 1.18 is a bad rule or that the committee got it wrong, he says. “The whole point of 1.18 is to make sure prospective clients can be comfortable talking to lawyers about their concerns. As lawyers, we want that.”

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